 I am, I live in Puerto Rico. I've been living here for four years now. I am a former finance professor. I am the former CEO of the Iron Man Institute, chairman of the board of the Iron Man Institute. How many people here have read Atlas Shrugged? A few. All right, that's good. The rest of you, shame on you. You should have read Atlas Shrugged. And this is one issue Sean and I will completely agree on. And I'm a partner at Hedge Fund, so that's all you need to know about me. Awesome. Thank you. Thank you. Let's give it up for you on folks. And in this corner we have Mr. Sean King. Hi everybody. I know many people here but there are so, so, so many new faces. So just amazing to see the growth. I'm Sean King. I am an attorney and CPA but primarily a entrepreneurial, serial entrepreneur, run several businesses, moved here to Puerto Rico in the very, very end of 2017. So just a couple months after Maria and have been here ever since. Absolutely love it. Not playing the numbers game. We're here 310 nights a year typically or sometimes more than that. So excited to be here today and particularly excited to be having this discussion with Yaron who is somebody that I greatly respect and admire and huge fan of Ayn Rand and her works, especially Atlas Shrugged, but there are others also. So he's right. If you've not read him, you got to read him. Got to read him. Awesome. Thank you. Let's hear it for Sean, guys. Is David in the building? David? David, you're in the building? Where is he? Only one David in the building? That's only one David in the building. Well, we want, we want to thank David because he helped sponsor tonight, you know, show that Sean King. So please, let's, let's, let's thank him for the room, giving us a space to gather and learn about crypto, guys. You know, that's what it's all about. It's a community like the, if you were, if you missed the class before, if you're new, shame on you because the class before really breaks down what's going on in the Bitcoin, how to, how to be involved into Bitcoin. And it was very interesting. Thank you to the Blockchain Trade Association, Koko Kiko, James Hart. Thank you guys for that. That was definitely teaching the Puerto Rican people about crypto. Very important, guys. Very important. Thank you, guys. You know, all right. So tonight's debate, tonight's show is going to be a big debate about Bitcoin money. And is it, is Bitcoin really money? So we're going to start with, who wants to go first? We'll let the crowd decide. Who wants to hear you're on first? Come on. Who wants to hear Sean first? We're going to go with Sean. He's got the better haircut. Okay. So Sean, what is Bitcoin? Yeah. So that's the first question. What is Bitcoin? I'm sorry. Excuse me. Is it money? Is Bitcoin money? All right. So this is the multi trillion dollar question. The short answer is at this point, I think we can say pretty confidently that Bitcoin is money. You can argue about whether or not it's the best money. You can argue about the quality of the money at this point. But I find it hard to argue and I tried to steal man this argument. I find it hard to argue against Bitcoin being money. So if you read the traditional definitions of money, money has three functions, right? The first function is, in no particular order, store value. The second function is medium of exchange. And the third function is unit of account. I think there can be little to no question at this point that Bitcoin checks the box for store value. It may be a volatile store value, but over any reasonable length of time, Bitcoin has gone up and up and up and up, right? We are more than double the 2017 all-time high at this point. The 2017 all-time high was more than double. The previous all-time high, which was more than double. The prior all-time highs, have we had some major corrections along the way? Yes. And we can talk about how and why that is. Also, if you look at the lows, if you go back and you just look at the low, Bitcoin's low every year. Forget the upside volatility. Just look low to low to low to low year to year. You see an extraordinarily positive uptrend in those lows. There's only been, I think, two years out of the last 11 or so that have been negative and they weren't dramatically negative when measured low to low. So I think the only argument you can make that Bitcoin is not money or that it doesn't satisfy the store value requirement is just its volatility. And it is very volatile. But, and this is huge, when you plot that volatility on a graph, it is going down, down, down, down consistently. And at present trend, if that trend holds, Bitcoin will be as volatile in about the year 2035 as the US dollar euro pair is today, which is to say not all that volatile. The second thing that gives me some comfort about the volatility is that it is, you know, again, almost exclusively to the upside. Yeah, there have been some 80 to 90% correction. Don't get me wrong. But in the grand scheme of things, when you zoom out on a chart, and especially when you look at a log chart and when you're dealing with any exponentially adopted asset or technology, especially one with network effects, I think log charts give you a far more relevant view than than standard charts do. When you look at a log chart, it's not that volatile on a log chart. And so that would be my argument that we check the box for store value. The second sort of key attribute of or function of money is medium of exchange. I think many years ago, you could argue that we couldn't check that box today. I don't see how you can. There are thousands up on thousands of businesses that accept it as a medium of exchange. A recent survey came out showing that about a third of small businesses currently accepted in the US. I don't know there's selection bias in that sample that seems slightly high to me, but still a significant percentage of small businesses do accept it today. AT&T accepts it. The Dallas Mavericks accept it. Microsoft accepts it. Tesla? Tesla, I mean, thousands and thousands of businesses across the country accept it. And when you especially factor in that you can spend it with a Visa card today, pretty much every business out there that accepts credit cards, well, at least indirectly accept Bitcoin. So I think we check the box for medium of exchange. If you're going to really, I think, poke a hole in Bitcoin as money, I think you probably would focus on the unit of account, right? Unit of account means how things are denominated, the asset in which other assets is priced and denominated. Not too many assets today, even those that you can pay your AT&T bill or buy a Tesla, they're not really denominated in Bitcoin, right? They're still denominated in US dollar or fiat currency for the most part. You can pay with Bitcoin, but the price of Bitcoin that you're going to pay is going to fluctuate based on the moment by moment exchange rate with the dollar. So I think you can argue that we perhaps don't fully meet the unit of account at this point. But, and it's a big but, the fact of the matter is that Bitcoin is the single and only unit of account that is accepted and recognized by the Bitcoin blockchain network. Bitcoin is currently a trillion dollar asset. Its economy is much bigger than the economy of most, not just some, most nation states that have their own fiat currencies. And so if you think of the Bitcoin blockchain as its own nation state, within that particular nation state, within that particular blockchain, it is in fact being used as a unit of account and it's being used as the only unit of account within that blockchain. So will that bleed over into the real world at some point? I think it's likely. I think we're probably at least a couple more adoption cycles away from that. I don't think you're going to see it really extensively used in the real world as a unit of account until we're through this hyper-Bitcoinization phase and the asset class is so big and much more stable and much less volatile that you can legitimately do that. So it's kind of a chicken and egg problem. You can't really price it as a unit of account in the real world until it's less volatile, but using it as a unit of account makes it less volatile in some ways. And so we'll ultimately see how that plays out. But I guess that's my argument for the moment that we do. Definitely check the first two boxes and I think if you look at it, if you look at the blockchain itself as its own sort of nation state in a way, we actually do check the third box also. And we can I think at this point conceive of and characterize accurately Bitcoin as money. Awesome. Thank you. You're on. You're on. You're on. I'm on. Yes. So let me, I'm not going to be a popular guy in this room. So I'm going to. We'll start with that. You're on. One second. Can everyone in the room hear us? Yes. Everyone can hear us clearly? Oh, bring it up in the back. Is there any way we could turn this up a little? Just Oh, no. Turn it up. No. Okay. No. You're gonna have to move closer. All right. Go on. You're on. So as I said, I'm not going to be the most popular guy in this room. That's going to be obvious. But let me, let me stop by saying this whole phenomena of Bitcoin is fascinating. And what you guys are doing is fascinating. And I love the fact that it's a trillion dollar market and the money's being invested because I think whether Bitcoin is money, and I don't think it is or not, it's going to spur some really, really interesting stuff and interesting technologies and interesting ways of doing business into the future that are going to be exciting no matter what. So don't take my negativity about this particular issue as negativity about crypto more broadly or Bitcoin more specifically. Plus, Sean knows a lot more about Bitcoin than I do. So we're starting out with there. I'm approaching this to some extent from a position of at least technical ignorance, right? Bitcoin, I don't think is money. And it's not money because it doesn't qualify for the second of the three, not the third one, but the second of the three criteria that Sean mentioned. Money is a common medium of exchange. It's money is something that people use to transact, to buy and sell stuff. You know, lots of things have been money in the past. In colonial America, tobacco was money. Gold obviously has been money. Stones have been money. All kinds of things have been money. Basically it's a medium to eliminate all the transaction costs, all the difficulties, all the impossibilities of borrowing. So we use something as an intermediary to get by the complexities and the impossibility to some extent of a border economy. And money is that thing that evolves that facilitates those transactions. It becomes the medium of exchange, a common medium of exchange. It's not common. I mean, it might be common in this room, but even in this room, I am going to bet that very few of you actually use bitcoins as a common medium of exchange. Maybe you do once in a while, maybe you do once in a while, but mostly you use it as what you perceive as a store value. Mostly you're holding it to get appreciation from it. How many of you are actually using it as money? I mean, yes, I know a few of you are. But most of you are still using dollars most of the time. And yes, it's kind of cool to use Bitcoin here and there. And there's a lot of different things that people have used over many decades as to do exchanges here and there because they were cool. They want money. They were cool things that people use to facilitate exchange. That's not what the definition of money is. And yes, lots of companies have Bitcoin. I have Bitcoin on my thing to donate money to you on Bookshow, which you should all do. I have the possibility of giving Bitcoin, but nobody does. Almost everything's in dollars. And if they did, what would I do with it? I wouldn't. I would convert into dollars. And that's what AT&T does. AT&T doesn't hold it. But how many people actually pay that? I know some people in this room pay their AT&T bill with Bitcoin. I don't know why, if you believe it's going to go up to half a million. Why would you pay your AT&T bill with it? You would hold it and sell it when it gets to half a million dollars, right? So it's not yet. Now, and this is a question, right? It's not money today. That doesn't tell you anything about where there will be money. And I think there is an argument and I'm willing to consider an argument that says one day it will become money. And we can have that debate and hopefully that'll be the follow-up question, right? Will it become money? Because I don't think it is today. I can imagine a world in which it becomes, I'm skeptical about that world. I don't think it'll actually happen. But I can imagine it. It's certainly not today. The qualities of store value and unit of account are consequence of the fact that money is the medium exchange. That's the fundamental, the other two are derivatives. But look, yeah, I mean, I can't argue with the fact that you guys have made a fortune holding Bitcoin. For you, it seems like a store value. And I can't argue with that. You guys are probably richer than I am as a consequence of holding Bitcoin. At least those who didn't sell in 2013, right? Those who kept it. But is it going to be a store value? And the question then is why? Why is it a store value? And in that sense, excuse me, guys, can we keep it down by the bar? Maybe a little bit? There's outside. You can always go outside. Yes. Thank you. They're not listening to you. Even if it is a store value, then you could consider an asset. It doesn't have to be that money, right? There are lots of things we invest in and they go up that are not money. They are assets. And then the question is where does Bitcoin gets the value to be a store value other than people wanting it to be a store value and desiring it, demanding it as a store value. And then the question is what happens if that sentiment changes? I question the store value long term. And then the third unit of account is, of course, a real problem. It's a problem because of the volatility. It's a problem because it's still true that everything, even Bitcoin, how do we measure the value of Bitcoin? If it was money, how would you measure the value of Bitcoin? If it was money, if Bitcoin was money, how would you measure the value of Bitcoin with what it could buy? That's how you measure the value of money with what it can buy. Bitcoin, how do you measure the value of Bitcoin today? In dollars. We all measure that. We watch the price of Bitcoin go up and down in dollars. Why? Because dollars is the unit of account. Dollars are the money. Bitcoin is an asset, an asset that might be overvalued, undervalued. It might be way undervalued. It might still have a lot to run. But it's an asset. It's not money. It's not how we measure what we buy stuff with. We still measure what we buy stuff with in dollars. Now, let me also say, and with this, I think Sean and I will agree, I would be thrilled if Bitcoin or something like it would replace the US dollar, if there was something that took away monetary control from the central bankers. I mean, there are a few things that would make me happier. But one of the things that would maybe really, really happy is to see central banks go away and money be privatized. Yeah. You got everybody on your side on that one. And then the question is, is Bitcoin the thing that will do it? Are the cryptos the thing that will do it? Is, I know I've got gray hair, is gold the thing that will do it? Is the dollar collapsing the thing that will do it? Will governments allow it to happen? So, but that's more a question now about, can Bitcoin become money? And maybe that would be the next. I think that that is the next question. And the next question is, Can we follow up on that one first? Oh, yes, please, please. Yeah, just a quick follow up on that. First of all, I think it's probably used in, I know it's used in exchange, much more than Iran, I think, is giving it credit for. And part of that may just be that he's not aware of it. But when you look, for example, at all the transactions that are taking place on exchanges in the DeFi world, for example, which is one of the most one of the most unbelievably important and fastest growing things I've ever seen in my entire life. And I'm absolutely convinced that we are in the very, very early stages of that world. And in that DeFi world, nearly every asset is traded and priced and paired in Bitcoin in some form or fashion. Bitcoin is, as many people say, the reserve currency of the internet. So I hear what he's saying, and I agree in the real world it doesn't have the yet, the prominence as a medium of exchange that he'd like to see. But with respect, I don't think that's the definition of money. The definition of money is not that it has to be the dominant primary medium of exchange. It just has to be a medium of exchange. And this is what I meant earlier when I said we could debate how good the money is at this point, how useful the money is at this point. But I don't think we could really debate too much that it is, in fact, being used regularly, consistently by millions of people all across the world every day as a medium of exchange and in the DeFi world and in the block as the primary medium of exchange and on the Bitcoin blockchain as the only medium of exchange. So for what that's worth. And I think there's a little bit of category error going on as my friend Luke Stokes likes to point out. I tend to make sometimes, or he thinks I do anyway, in the sense that you're on seems to be saying that if it's not money in one particular domain that it's not money in any domain. And I agree there are domains in which it's not functioning as money currently, but I think there are domains in which it very clearly is. So I agree people are using it as money. Is it money in a sense of a common medium exchange? I think it's not yet. It might become soon. I'm skeptical, but it could become that, but it isn't yet. It is in certain niche markets being used as if it was money. Although even there I suspect that a lot of the transactions are being converted into dollars much faster than one would expect if it was real money. So what would be, do you think it's going to be valuable in the future? Bitcoin? Yeah, I mean, if it becomes money, yeah, it'll be valuable. It'll be more valuable than it is today if it becomes money. So the thing about Bitcoin is the only path that I see, and again I'm happy to be corrected on this, the only path that I see for it to be valuable is to become money. That is, Bitcoin is compared to other cryptos. Bitcoin is compared to other cryptos. It doesn't have any other uses as far as I can tell other than becoming money. Ethereum has other uses. Again, I'm not here plugging Ethereum, but there are other cryptos that are being devised in ways as to be useful in other ways other than as money. Bitcoin strikes me as a one trick pony in a sense that it is either going to be money or it's not going to be valuable. So its value is going to be divided by the potential to become money or not. And so this question of its potential to become money becomes crucial. Again, I would say money is commonly used, common, right? People are using it, not just the crypto community, but beyond that. And I think there are a number of problems with Bitcoin in terms of it becoming money. It faces stiff competition. Stiff competition is something we already use as money and it's very easy to use as money. Dollar bills, the easy transaction costs are very, very low, much lower than Bitcoin. They're ubiquitous. There are problems with the dollar. We all know the problems. But most of the world out there doesn't really have that understanding of the deep problems that evolved in dollars. And as somebody who's lived through inflation, I lived in an era I originally was, I was born in Israel. And in the early 1980s, Israel had a thousand percent inflation, right? And we had a currency during a period of five, six years lost, four or five zeros. I can't remember, they dropped two once and then another two later. So you'd think this paper money was, everybody would be up in arms about, let's get rid of paper money. Let's go to something real. In fact, there's everybody adapted very quickly. Transaction costs were still low. You know, banks, your salary went up really fast. People learned how to consume in an environment like that. It's awful, right? Don't ever live in a high-paying inflationary environment. It's not fun. But it's not like there was this immediate demand for some alternative and to get rid of the government and everything. It was bad, but livable. Hype inflation would be the one thing that I think in America today, people would really start looking for alternatives. Again, whether it's Bitcoin in the end or not is a question that people would look. But other than that, a dollar economy is just and put aside the macroeconomics. A dollar economy is just on a day-to-day basis, just too simple, too easy. And it's very, very difficult to compete. It's a network effect. Billions and billions of people around the world use dollars every single day for gazillions of transactions. The Visa and MasterCard networks can do 24,000 transactions a second. A second, 24,000 transactions a second. So it's hard for Bitcoin to gain traction. Money is a network thing, right? It's what you need a lot of people to use it for something to become a common medium exchange. There are lots of people using dollars. There's still relatively speaking, few people using Bitcoin. It's got a steep uphill to battle against the dollar. There's an issue about supply of Bitcoins. Bitcoins are capped, as we all know, 21 million, I think is the number, right? That is problematic when the money supply doesn't grow with productivity. I don't think that is a long-term solution. I don't think that's ideal. I wish they hadn't created that constraint on it. You want to be able to create a money where supply and demand match up better over time, over a lengthy period of time, as productivity increases, the supply of money should increase as well. It's expensive to transact. I know there are ways to get around the expense of transaction. So again, technology will solve that problem, hopefully. But right now, Bitcoin is expensive. That's one of the reasons, potentially to do the transactions. One of the reasons it's not as huge as maybe would be otherwise. But I think the biggest issue is with Bitcoin has nothing to do with technology, has nothing to do with markets, has nothing to do with the nature of Bitcoin and has everything to do with the fact that governments hate it and won't allow it because it takes away power from them. Any independent form of money is going to be crushed by government. It's going to be stopped. Now, I know it's anonymous and the networks are separate and the government won't... I think every crypto person I've talked to, I think underestimates how nasty these people can be. How committed, if they are committed to destroying something, how far they are willing to go to destroy it. We've seen it just banned in China. Now, I know that didn't have a big impact on that. That's every other month though. What's that? That's every other month. No, I get it, but that's part of the issue. Governments are trying to figure out how to manage it. If you look at El Salvador, it's a really interesting... I was just reading up on it today, the El Salvador using crypto. You know that when a business gets crypto and it wants to convert it to dollars, it doesn't convert it to dollars, it converts it to a stablecoin issued by the Salvadorian government. So it's a way for the El Salvadorian government to control how crypto is used, how particular bitcoin is used, and ultimately to go off of what they have as money today, which is the dollar. So it's a power grab by government, a stealth power grab by government that people don't see. Every country is trying to figure out how to regulate, how to control it, how to manipulate it. I don't think anybody's got it right. China's banned it. The price didn't go down a lot, and my theory on why the price doesn't go down a lot is because in a sense, bitcoin became more valuable when it was banned in China. Why did it become more valuable? Because I believe that a big chunk of the value of bitcoin is to facilitate transactions, which I think dominate bitcoin. I think the transaction type that dominates bitcoin is transacting in illegal stuff. Now I'm not against transacting in illegal stuff, just so we get it, right? Careful, the feds are listening. That's fine. So of course they're listening, they're listening to everything. I mean, if you think you've got privacy, you're delusional. The Chinese, when the Chinese banned it, that increased the motivation of Chinese billionaires to own bitcoin and use it to get their money out of China. So one of the ways to get around capital controls, this is the beauty, I think, of bitcoin, one of the ways to get around capital controls is to use bitcoin and to use other cryptos. And I think one of the reasons that it hasn't suffered because of China is because now there's a demand for it, which is a result of the need to use it to circumvent capital controls. All right, that is a lot to respond to. That was a lot. It got me lost. He made about five really good points, and I want to respond to all of them, but I won't be able to remember them, so I'm counting on you guys to prompt me as we go through so I can try to check them off. Number one, I think Yarn is right, that money is ultimately a network effect thing. And the rule of thumb, as tech people know in Silicon Valley and elsewhere, is it's not that network effects are insurmountable, it's that something needs to be 10x better for it to surmount or usurp the incumbent technology, the incumbent network effect. And so you've got to ask yourself, we talked about the three functions of money, but what ultimately ends up dominating as money isn't just anything that qualifies with those three functions. There are other attributes of good money that really determine what ends up dominating. Money must be, of course, sufficiently scarce. Bitcoin beats gold, and Bitcoin beats USD, and Bitcoin beats every fiat currency at that by at least 10x, right? It must be divisible. Bitcoin is infinitely divisible with consensus. It must be ideally easily secured. There is nothing out there, no asset, that is easily secured even from nation states, as Bitcoin is, and as various types of cryptocurrencies are. So I could continue to go down the list of attributes of money, what makes anything that first satisfies the three functions of money, what causes money to dominate, and Bitcoin is way, way ahead of everything else in terms of those. Now, which gives me some confidence that we can, in fact, overcome the US dollars and other fiat currencies network effects. With regard to network effects, I think it's important to remember how they work, right? When we were decoding or sequencing the human genome, it took eight, there were two projects, right? The government-run project and the private project. It took 10 years for them to sequence 1% of the genome. 10 years, and nearly everybody at that point was saying, it's going to take 100 freaking years to sequence the genome, right? There were a few very technologically astute people out there, Ray Kurzweil and others, who said, absolutely not, absolutely not. Once you're at 1%, you're only seven doublings away from 100%, right? And that's the way these sort of things work. And, you know, Kurzweil predicted that within a matter of just a couple of years, we would fully sequence the human genome, and he was absolutely, absolutely right about that. Bitcoin crossed the 1% threshold a year ago or so, depending on how you measure it. We're currently at around 2%, 2.5% adoption. We're closer to 20% adoption actually in the U.S., worldwide. We're about 2%. At 2% adoption, you're six doublings away from 100%. And we have a decade-long track record now of Bitcoin adoption doubling every eight to 12 months, consistently like clockwork. It is just a classical, exponential network effect technology. Now, until we cross the tipping point, which is 8% to 10%, there's always a risk that something else comes along and usurps it. I think Bitcoin has such a network effect advantage at this point that something else coming along and displacing it, usurping it, is not likely, but still possible until we get to 10% worldwide adoption. I think we'll be at 10% worldwide adoption within the next two to three years at most. At that point, I think it's all but unstoppable, and you're really just a few years away at that point from essentially saturation. What were some of the other points that you're on made? The transaction costs. True, if you're settling transactions on the blockchain, there are transaction costs, and in some cases they can exceed the cost of transacting in US dollars, but in many cases they're not. You see a number of examples every day where tens or hundreds of millions of dollars are transferred peer to peer on the Bitcoin blockchain for transaction fees of 10 bucks, 50 bucks. Tell me where else you can do that from the US to wherever you want to send it to in the world. That's number one. Number two, you got to remember layer twos, right? The lightning network and everything involved with the lightning network, that allows you to send unlimited amounts of Bitcoin effectively for free, and this is what's being done currently in El Salvador primarily. And the El Salvadorian government is exchanging that Bitcoin for a stable coin for free. The El Salvadorian government is not charging any transaction fees to convert Bitcoin to a stable coin for those who want to convert it. And so I think when you count layer two, Bitcoin very, very clearly is going to be able to transact unlimited volumes of transactions, much more than the Visa network per second at a much lower cost at the end of the day. We're not there yet to Yaron's point. To some degree speculating on where this is heading, but I don't think it requires a lot of guesswork. I think we can see pretty clearly where this is going. What else? What are the great points that Yaron made? Oh, I love this one. Thank you. Government opposition. Yaron's absolutely right. Some governments will try to crush it. What I think you have to remember most when it comes to this particular topic is game theory. For those who aren't familiar with game theory, game theory is the study of how people make decisions when the move that you make influences the move that somebody else is going to make and when the move that somebody else is going to make influences the move that you're going to make. So no doubt there are countries out there like China at the moment who is going to attempt to ban Bitcoin and they're going to attempt to shove their central bank digital currency down the people's throat. That is ultimately not going to work for China because as long as there are some countries out there such as currently Al Salvador but soon to be a great many more who benefit from defecting, they are going to defect. Some of those countries who benefit from defecting are quite powerful. Some of the states in the US who benefit from defecting such as Texas are quite powerful. And so when you consider the competition among states and the competition among countries and the massive advantages that are gained by not just tolerating Bitcoin but by actively subsidizing Bitcoin, you're going to see multiple places do what Kentucky recently did which is wave the taxes on electricity for anybody who sets up a Bitcoin mining rig and uses power in Kentucky to run their mining rigs. You're going to see states actually subsidizing the adoption of Bitcoin and the mining of Bitcoin. Not every state not all at once but those who do are going to benefit massively and ultimately that's going to compel by economic necessity those who are resistant to adopt it. To think otherwise is to think that some country out there could have or a group of countries out there could have successfully banned the internet. Every country that tried it ultimately got overrun. The internet was not banable. It was designed to not be banable. Can you slow it down? Yes to your own detriment. You can slow the adoption down for a while to your own detriment but as long as other people that you can't control are adopting the technology and using the technology you're going to be left in the dark ages if you don't eventually come around and adopt it yourself. Thank you. Thank you. Thank you guys. You want to respond it looks like you're on it. You just want to go for it. Go get them. The commentary is more interesting than what I have to say. I think you should just take the floor. I'd say you know so let me just make a I'm going to speculate here that if we're sitting here in two years you won't be thinking too positively about El Salvador. I don't think that experiment is going to go well. I don't think it's going to do what you guys think it's going to do. We will see but I am skeptical about their motivations for doing this and what the exit strategy is for the El Salvadorian government. This is not a ploy to bring more freedom to El Salvador. This is a ploy to reduce the amount of freedom in El Salvador but we'll see. I mean that's still to be played out. It's a ploy to be more free from the U.S. vet. That's what it's a ploy to be free from. It's a ploy to get rid of the U.S. dollar as a means to dollarize the economy but not in favor of another currency that they can't control. It'll ultimately bring back some form of El Salvadorian currency to back the stablecoin. It's not going to end well. Put it that way. I don't think it'll end well. So I think also there is generally a sense of underappreciating and the nature and the willingness of government to remember central banks. I mean it's hard to overstate how important central banks are to central planning. I mean this is the main tool governments have to try to manipulate economies and to try to control our lives. Through the supply, the control of supply of money, through the control of interest rates, through the control that they exert through a central bank it gives them the ability to run what 20 trillion dollar deficits. It's given them the ability to run the kind of deficits we experience today. They couldn't do that in a gold standard of bitcoin like world or any world like that. And the idea that these governments is just going to fold because El Salvador is competing with them I just don't think is going to happen. And yes Kentucky might do this because you know there's a democratic government right now and they want to undercut them. So who knows what motivates the particular politicians who are trying to drive a particular industry in and get jobs and tax revenue. But long term the central government which controls the central bank I don't think is going to allow this to happen. How are they going to stop it is a good question I don't know. And look right now there's a coalition of 130 countries. 130 countries around the world have signed on to this idea of having a minimum corporate tax rate. So there's been this competition of lower and lower corporate taxes around the world. And Ireland has a very low corporate tax. Hungary has a very low corporate tax. And now 130 countries want to enforce led by the United States of all countries a minimal corporate tax of 15 percent. And you think that again the same kind of prisoners that the same kind of game theory works. Now we'll see if it works. There is some indication that this is going to fall apart for the reasons you just indicated. That is some countries are going to say no like Hungary which is European Union out of you know but the European Union you have to have unanimous agreement. Every country has to agree to any major change. Hungary in a sense has veto power and their corporate taxes nine percent. So they might veto this but we'll see. There is an effort to aggregate all these countries the biggest economies in the world and to ban corporate taxes below 15 percent. There could very well be an international coalition of statists of governments who come together to try to try to find a way to not ban crypto and even or to try to ban crypto. Your argument is you can't because it's anonymous and it has these amazing networks and everything. But what it would do is suppress your ability to use it as money. And that's the point right. We're talking about can it be money. So let's say the government tomorrow said you can transact crypto all you want guys. You can't buy anything in the real world with it. You can deal with it with banks and we control the banks if you know anything about American banking that can be controlled by the regulators. You can buy a Tesla with it because while we don't know what you do on your networks we know when you buy a Tesla that is a physical transaction that we can easily monitor. You just can't buy stuff with it. You can't use it as money. Now what would happen in that case. It would stop being money. Now you would argue all the transactions would move to El Salvador to some extent. But how much stuff can you buy in El Salvador. Not that much. So and it's not clear that the alternative economy is going to benefit from it dramatically in a way that would force let's say the American government to say OK now you can transact in those. So I still think that you underestimate what the government can do and likely will do to the extent that you guys are successful in launching this because you're attacking. You're full on attacking head on a major source of their power. A major source of their control. I certainly agree with that. Just a real quick follow up on that. I don't think I'm underestimating their ruthlessness. I don't think I'm underestimating their evilness. I'm not under any delusion that El Salvador for example is is pro-freedom for its people and that's why it's adopting it. In fact I'm counting on these guys being ruthless self interested people. Right. Because that's when game theory is at its best. And when you have multiple governments across the world with different interests and not just different but competing interests the idea that they're all going to get together and hold a cartel together that is sufficient over the mid to long term to adequately suppress this this new peer to peer internet based technology just seems very unlikely to me. This is just a point at which I think Iran and I are just going to disagree and it's up to you guys to decide which side of the sandbox you're going to play in. I'm sure we got a lot of questions in the crowd. Go ahead Iran. I don't want to cut you off. I was just going to say if governments were that rational and that self interested in that sense there would be very few wars in the world. All right guys. Let's thank Sean King. You're on bro. Now we're going to follow up with a couple of questions. But first of all we had one of our young ladies Coco lose an ear pod. It was over. Apple pro. Air pod pro. Excuse me. If anybody found it. No. Thank you. Sorry Coco. All right guys. I know you got to have tons of questions so let's start on this side of the room. Anybody have a question. All right. Hey. Yeah. So maybe it says something about me that I was just attracted to the earlier discussion of monetary theory. It's Bitcoin money. You made a reference to measuring Bitcoin in USD and measuring and USD in what you can buy with it USD being kind of the default default thing. I don't think that's quite right. I think it might misconceive how the relation between how assets work in general. You know we do measure Bitcoin also against JPY against I don't know any sort of asset euro currency and then you measure more importantly USD versus other currencies. We actually do have a point of measurement for USD other than other than things you buy. Every asset is measured in relation to every other asset. It's just how are we determining the liquidity of that relationship and tracking it on a chart as long as we can do that. I don't know. We're measuring it and we do that for a lot of different commodities currencies whatever. Sure. So every asset can be measured against every asset of course but what makes money money is it becomes the unit by which all assets are measured against. So when you go into a grocery store every thing in the grocery store every product in the grocery store is measured in terms of dollars. Now you could measure it the tomato soup versus the bananas. You could do that but that's the whole point of having money is to not have to do that right. The whole point is not to have to barter not to have to figure how many bananas they have to give you to get the can of tomato soup. Right. That's why we have money is to serve as a unit of measurement across the various types of products and assets that we have. It's still true and I think Sean acknowledges that dollars what we use to do that. You know again as if Bitcoin becomes money it will become the thing that when you go into a grocery store that's how you know that's the that's the measure for every product that's out there. Awesome. We're going to go on this end. Right there. Guy right there. Listen the price is right. Got Vanna Vanna and I got to train these guys. You know what I mean. Well I thought you were the next to talk. Okay cool. Thanks man. Well so I had a different point to bring up but what you guys are talking about there is a place where Bitcoin is the unit of account by the way where everything literally everything is measured in Bitcoin and that's called a cryptocurrency exchange. They're called BTC trading pairs so everything every cryptocurrency on that exchange is tradable in Bitcoin and on many exchanges they're not tradable in dollars so on those exchanges the dollar is not a currency because there is no dollar. There might be USDT but you say you want about that but but they're all available in Bitcoin they're mostly available in Ethereum sometimes they're available in in a BNB or whatever but but I mean but that's not my main point. My main point is I think that the entire that entire definition of this this triune God that everyone has of like what money is I don't think that's correct. I think you can pretty much sum it up with just one which is money is what the government any government in particular collects taxes in and that's the only it's almost the only reason why it's valuable. So what's your question. Well in other words if you think about it if when you have money when you if you had if you owned your own house and then you you know you're you're doing a trade in in silver or gold you know what here's the it's a rhetorical question but you know could you just trade in silver and gold or Bitcoin or whatever you wanted to what what is the one thing that's keeping you from doing that and the thing that's keeping you from doing it because you could barter and all those things all year long but at the end of the year you owe a two percent tax millage rate wise on your property that you own where you do your homemade you grow your crops or whatever it is that you do you still owe the government two percent not even not even income tax even if it's barter or whatever like not even income tax just like tax on your property you owe the government in dollars so every year you're going to have a yearly like flight to the dollar where everyone needs to convert two percent of the value of their house into dollars so I think that you can really so I get it it's not it is a unit of account but it is the dollar right now like is it really store value the answer is no it is not well I don't again money doesn't have to be a store value money but it does in exchange according to you guys and it is just according to me it doesn't according to me it's just the taxes okay okay I get it but and I agree I don't disagree with you right I think what you're saying is a key reason why the dollar has part of the networking effect that it has I mean the US government today is about 40% if you include state and local it's over 40% of the US economy is the US government the US government uses dollars so it it taxes I don't know what the taxes are taxes are 18 to 20 percent at the federal level and then if you had state and local I don't know what that adds up so 18 to 20 percent of you know GDP is is is taxed right is is is taxed and it's in dollars right so a big chunk of the network of it we talked about what tilt something into net into become the dominant network it's is it 10% is it 15% well the government already has like 40% right and it's all the nominated dollars and it only uses dollars it's very difficult to overcome that effect that the government pays for everything in dollars it doesn't just collect taxes it buys a huge amount right government is a big big player in the US in the US it's relatively small to other countries where it's even a bigger wouldn't you rather if you had a printing press wouldn't you rather buy stuff that you could from with currency that you can print rather than something that Sean is mining and is independent from you and yes so so yes so that's why I think it's very very difficult to overcome the network effect that the dollar has I mean not only that I would also develop something like the petrodollar agreement so I can drum up extra tour extra territorial demand from people who aren't even US citizens to use us let's not get that that's not the base just ask the question you're on may agree with you but I absolutely do not agree with you but the taxes and the petrodollar those are two ways that like that's what makes something that's what makes a reserve currency second one first one's what makes something money shut no we have numerous historical examples of money existing without government lots and lots and lots of historical examples of money existing without government so your argument that money cannot exist without government without taxes is just provably false we have lots of examples of money existing with our government that's literally what he said you did not say that in order that money is defined as that in which government taxes did you not say that and nothing else can be money in that scenario so my in miami right now you can pay your property taxes with bitcoin and in lots of other places you're going to be able to pay your property taxes with bitcoin or other cryptocurrency so so even if you're right it doesn't mean that these can't be money wait wait wait I want to challenge Sean what Sean just said I want to if I can ask you a question right when you pay your property taxes in miami with bitcoin is it denominated in bitcoin therefore it's a fixed amount of bitcoin that stays for years no it's the nominating dollar so bitcoin is just like you're using a credit card I can use a credit card to pay but the credit card is not money so bitcoin is just a means to get a dollar all right so we're gonna we're gonna move on to the next question over this way but I got one question do you own bitcoin no I wish I did was you had the question I screwed up ten years ago but I would have sold in 2013 that's the reality I know that okay people question so first of all I have a question to all of you who finds the question of what is money one of the most fascinating questions ever so who who else me I think many many people in this audience right so the best answer to this question I was able to find of the research for the last couple years was that money is stored labor so this is me time of my past generation some of my future generations it's you how would you guys prefer your labor stored as something that can be easily debased or something that is cryptographic and objective I'm not even referring to USD or bitcoin per se how would you prefer your labor to be stored as human labor human time and creativity is the only truly valuable thing on the planet everything else is a function of it so let's take that so I two two things one I don't think what you describe this money and if you're interested in the theory of money and credit you know I I think the best book written about this was von Mises book the theory of money and credit that he wrote a long long time ago and there's a masterpiece on this topic and I'd recommend reading that I you know money is not a store money is a medium exchange and if you think about how money evolved it evolved to facilitate trade it did not evolve to store stuff it became a store value but it didn't start off that way it started off as a way to reduce the transaction cost of order but there's another you brought up this objective this this idea of being objective and that's an issue I have with bitcoin that I haven't raised yet so I might as well raise it now and that is what actually gives bitcoin its value that is why is it worth forty thousand five hundred thousand whatever other than the fact that you guys think it's worth that is beyond your subjective somewhat seemingly arbitrary preferences what gives it its value so this is a question for Sean really and yes it's limited but you can imagine other things that are limited in in scope it has certain characteristics that fit but it has no tangible value it has no use other than money every other money in human history with the exception of fiat money every other money with the exception of government fiat money has had an alternative use to it like gold you could do other stuff with tobacco you could smoke the rocks you could you could mold into sculptures or whatever fiat money and bitcoin seem to be the first monies that don't have an alternative use and and and i'm curious in that sense is there a difference between bitcoin and ethereum ethereum which you can do smart contracts with it has another use and wouldn't that make a better money because of that than bitcoin yeah well first of all i'm not a bitcoin maximus but um there is an upgrade coming out i think in november called taproot to to bitcoin that will basically facilitate smart contracts on the bitcoin network so bitcoin has been a little bit handicapped in that regard it'll be interesting to see what sort of traction ultimately takes place in there but i think it's totally wrong and i hear a lot of people who are very pro bitcoin primarily finance and economics types almost never tech types make the the error by claiming that bitcoin has no intrinsic value that it has no use value separate and apart from from its use as as money this is this is just not the case bitcoin is the most it's the largest by far and the most secure by far distributed or decentralized ledger in existence now you have to think about what is the use of a decentralized ledger can it be used for things other than money absolutely it can be used for things other than money one just very simple example that can be used for is unsensorable speech when satoshi nakamoto mined the original genesis block he included in there a political statement a reference to a particular news article in a particular newspaper um noting that the chancellor in england was bailing out the banks in the last financial crisis and uh objecting to that you can log and you can register hashes of very important documents and you can log them in the bitcoin network improve 10 years later 50 years later beyond any shadow of a doubt that that document existed at that particular point in time and exactly that format had we had bitcoin when barack obama was born and had birth certificates been registered in the blockchain as they originally will we would not have had the whole birther movement so those are just two very simple small examples now layer on smart contracts and the fact that you can you can take the entire not the entire but you can take large portions of the insurance industry and do away with the insurance carriers have smart contracts running on a blockchain that actually provides effective significant meaningful insurance to you without the cost in the overhead of going through a central insurance company and uh that's a that's a very very significant thing right so there are lots of things that you can do on a blockchain now the fact of the matter is on the bitcoin blockchain you can't do any of those things unless you first have bitcoin bitcoin is an ax a cryptographic access token that gives you access to the bitcoin network and to the decentralized ledger that's on it so if you want to do any of these amazing things that I just said and many more that are just totally mind-blowingly amazing you have to have some bitcoin now does that justify bitcoin's current price probably not there's a hell of a lot of speculation no doubt built into bitcoin's current price when we're at you know two percent worldwide adoption lots of people were forecasting much greater rates of adoption into the current price but it's it's just inaccurate I think to say that that it has no use value separate and apart from its use as money it very clearly does so that was actually the most convincing case not that you proved it but the most interesting case I've heard